June 20, 2019

The U.S. Treasury increases its pressure on Iran with new sanctions designations

By Guido Lanfranchi.

In late March, the United States Treasury further increased its economic and financial pressure on Iran. The most recent measures consisted of sanctions towards a network funding Iran’s armed forces, as well as of enhanced warnings for private companies engaging with Iranian entities.

Since May 2018, when the United States decided to withdraw from the Joint Comprehensive Plan of Action, also known as the Iran Nuclear Deal, the U.S. Treasury has been busy with devising and implementing a set of measures aimed at depriving the Iranian government from its sources of revenue.

Speaking to the press during a trip to South and South-East Asia, Ms. Sigal Mandelker, Under Secretary for Terrorism and Financial Intelligence at the U.S. Treasury Department, outlined to the press the most recent set of measures, which took effect as of March 26th

The most recent sanctions imposed by the U.S. Treasury targeted a network of 25 individuals and entities from Iran, the United Arab Emirates, and Turkey, allegedly involved in the transfer of over a billion dollars to Iran’s armed forces, notably to the Islamic Revolutionary Guard Corps (IRGC) and Iran’s Ministry of Defense and Armed Forces Logistics (MODAFL). This network was devised by the Iranian government to provide support to the IRGC and Iran’s foreign fighters abroad, including in Syria – Ms. Mandelker explained, noting that similar patterns of behaviour had already been observed over the past years.

Under Secretary Mandelker described the mechanism employed by the network, which consisted of front companies set up by the Iranian entity Ansar Bank and its subsidiary Ansar Exchange. These entities allegedly trafficked in rials, dollars, euros, and gold, in order to provide large amounts of money, amounting to over a billion dollars, to Iran’s armed groups, such as the IRGC and MODAFL. These military entities are largely involved in Iran’s military efforts in the region – Ms. Mandelker noted, stressing that both entities were also designated under the European Union’s non-proliferation sanctions authorities in 2011.

In addition to such measures, at the end of March the U.S. Treasury also updated its Maritime Advisory of November 2018. Back then, the U.S. administration had warned private companies, and especially shipping companies, about alleged oil-for-terror schemes, in which the Iranian government would ship oil to countries in the Middle East in exchange for money to its military proxies, such as Hezbollah, Hamas and the Quds Force. In the March update, the Treasury highlighted the presence of additional risks related to Iranian oil’s shipping to Syria, providing guidance to companies on how to mitigate risks and warning them against conducting business with Iran. 

Such actions – Ms. Mandelker reiterated – are part of the broader U.S. campaign to put “unprecedented maximum pressure” on Iran and its government. The standoff between the United States and Iran seems set to continue at a very high level. 

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